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Liability to pay service tax

Neethu (CA) (138 Points)

23 March 2013

If the service provider who has collected service tax failed to pay the same to Goverment, Can the authority demand the unpaid tax from the service receiver? Please note that period of default is from April 2007 to September 2011.

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2 Replies

Asif Khan (Taxation executive) (410 Points)
Replied 23 March 2013

I my view

In Simple terms the department will review that in this case who is liable to pay service tax to government. Before reverse charge mechanism was introduced it was always the Service Provider who was liable to collect and pay service tax to the government as per Sec 68 (1) of the Act .

In your case if the service reciever has paid service tax to service provicer than department can recover the service tax from service provider only.

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CA.VATSAL SHAH (SERVICE) (202 Points)
Replied 25 March 2013

liability of service tax of charging, collecting and paying to government is of service provider only. so in your case nothing is concern with service receiver

even in case of reverse charge mechanisam if service provider did not charge or after charging and collecting of his part if he did not deposit into government service receiver is no concern. he has to oblidge and pay his part of service tax under reverse charge. thats all.